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Ohio Senate Bill Extends Registration Requirement to Mechanical Repair Shops, Also Anti-Steering Bill In November 2013, state Sen. Joe Uecker (R-14) introduced Ohio Senate Bill 232, a bill to level the playing field for mechanical automotive repair shops. S.B. 232 extends the jurisdiction of the Motor Vehicle Repair Board (MVRB) to anyone who performs mechanical repairs on motor vehicles, requires motor vehicle repair facilities to register with the board, creates the Motor Vehicle Repair Operator Vendor’s License Suspension Fund and makes changes to the Motor Vehicle Repair and Window Tint Operator Law. The Automotive Service Association (ASA) supports S.B. 232.
Under current law, only collision repair facilities are required to register with the MVRB. This loophole for mechanical repairs has allowed “backyard” operators to undercut legitimate businesses by avoiding compliance with OSHA laws and Ohio’s environmental standards. Because many of these “backyard” shops do not pay taxes or workers’ benefits, there is a considerable price difference between these operators and law-abiding shop owners. S.B. 232 would ensure that all automotive repair professionals are adhering to a uniform set of service and safety standards.
Collision repairers from six states are pursuing legal action against insurers for alleged antitrust violations, collusion by making deals with preferred body shops to reduce labor costs, and interfering with body shops’ business by dictating how they do repairs. There are also allegations that shops are being forced to use substandard repair parts. The body shops are seeking damages from the suits that could amount to damages in the billions. See Autobody News May edition for more details. In the federal lawsuit, 14 Indiana shops and others have accused State Farm Insurance and competitors of extracting “unreasonable and oner-
ous” concessions on vehicle repair costs. When a shop doesn’t comply with price ceilings, the insurers dissuade policyholders from choosing that shop for repairs by telling them it has quality issues or gets lots of complaints, the shops allege in the suit filed April 2. The 34-page suit alleges insurers have violated the federal Sherman Act, both in price-fixing and through boycotting tactics. Insurance company dictates are “placing the driving public at harm,” says the lawsuit. (Other defendants include Allstate, American Family, Auto-Owners, Erie Insurance, Indiana Farmers Mutual, Liberty Mutual, Na-
See Ohio Senate Bill, Page 4
Update on Shops’ Accusations of Insurers’ Collusion
See Shops’ Accusations, Page 13
VOL. 3 ISSUE 9 JUNE 2014
U.S. Rep. Cheri Bustos, D-East Moline, Visits Body Shop, Talks Minimum Wage U.S. Rep. Cheri Bustos, D-East Moline, clocked in for her shift at Dave’s Autobody in at 2:59 p.m., one minute early, according to reporter Dani Kinnison, writing for the Galesburg Register-Mail As part of her “Cheri on Shift” outreach, Bustos made a stop in Galesburg on April 23 to shadow the shop’s auto workers and do some welding and discuss the issue of livable wages, an issue that’s been a source of discussion locally and nationally. With Illinois’ minimum wage of $8.25 an hour, a full-time worker would earn a yearly salary of $16,500. For a family of three, the wage lies below the federal benchmark for poverty. That, Bustos said during her visit, is something that needs to change.
Auto body production manager Robby Dunn, center, looks on as U.S. Rep. Cheri Bustos, D-East Moline, talks with Dave’s employee Chip Brandenburg in the back of a pickup truck at the auto body shop. Bustos took a hands-on tour of Dave’s as part of her “Cheri on Shift” outreach in the 17th Congressional District. Photo: Steve Davis/The Register-Mail
The 17th Congressional District representative said she would be in favor of increasing the federal minimum wage to $10.10 an hour, an inSee Minimum Wage, Page 15
Michigan Lawmaker Proposes Crackdown on Unlicensed Auto Repair Shops A senior citizen living in State Representative Harvey Santana’s district contacted a local media Consumer Investigator Unit called “Ruth to the rescue” to complain that he had taken his car to a West Detroit shop and has since “been stranded for 5 months.” 82-year-old James Fails said he used the repair shop known as Domestic And Import Auto at 9900 Greenfield in Detroit. Fails said his car was never the same afterward, and he’s suing the facility to get his engine replaced. The Detroit grandfather’s family was shocked to learn the shop’s license had expired. “I just shake my head to still see them open,” Fails granddaughter told Ruth to the Rescue. “We have a responsibility to make sure that this senior citizen, who is a grandfather and lives on a fixed income, doesn’t have to go through the experience he just went through,” Santana told Ruth to the Rescue.
Ruth Spencer visited the garage and the owner admitted in March that he didn’t have a valid license. Back then, owner Ali Beydoun told Spencer, he would be getting his license renewed very soon. The Democrat decided something must be done. He’s now working with several interested parties to create legislation that would fine repairs shops that do not have a license. The proposal would call for a $5,000 fine for the first offense and $7,500 for every offense that follows. “What bothered me is the license ranges from $50 to $500 a year on a sliding scale, so why not just play by the rules and get it?” said State Representative Harvey Santana. What about the shop on Greenfield road? As Ruth to the Rescue started working on the story of this legislative proposal, we wondered if Mr. BeySee Crackdown, Page 19
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